DEFINITION of 'Portability'

An employee's ability or right to retain certain benefits when switching employers. Benefits such as certain pension plans and health insurance have portability. Most 401(k) plans have portability of benefits, as well as health savings accounts (HSAs).

BREAKING DOWN 'Portability'

Portability is a U.S. employee's right to keep or maintain certain benefits when switching employers or when leaving the workforce (retiring). The Health Insurance Portability and Accountability Act of 1996 (HIPAA) provides rights and protections for participants in group health plans. HIPAA states that employer health insurance plans may not be able to exclude coverage for preexisting conditions; provides opportunities to enroll in a group health plan if either coverage is lost or certain life events occur; prohibits discrimination against employees and their dependent family members based on health factors; and assures that certain people will have access to, and can renew, individual health insurance policies.

  1. Group Health Insurance Plan

    An insurance plan that provides healthcare coverage to a select ...
  2. Portable Benefits

    Benefits that have been paid into or accrued in an employer-sponsored ...
  3. 401(k) Plan

    A qualified plan established by employers to which eligible employees ...
  4. Health Insurance Portability And ...

    An act created by the U.S Congress in 1996 that amends both the ...
  5. Flexible Spending Account - FSA

    A type of savings account available in the United States that ...
  6. Crowding Out Effect

    An economic theory stipulating that rises in public sector spending ...
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  3. Are 401(k) rollovers taxable?

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